Dark network tensions and illicit forbearance: Exploring paradox and instability in illegal cartels

In this case study investigating illegal cartels, we contribute to our understanding of the dark side of business relationships in three different areas. First, we expand upon the dark side of business relationships theme, by investigating the nature of opportunism in price-fixing cartels and the role of illicit forbearance. Due to their illicit nature, cartels are forced to operate outside legally binding contractual frameworks requiring other ways to facilitate agreements to avoid opportunistic behaviour. Second, our investigation contributes to our understanding of tensions in business relationship settings. Our findings indicate that network tensions are made significantly worse by the illicit nature of cartels, resulting in inherently unstable relationships. Third, in addition to cartels, we argue for a broadening of the scope of the 'dark side of business relationships towards one that recognises the importance of illicit practices undertaken by marketing managers. This is significant because illicit relationships are often archetypal examples of opportunistic behaviour, which are likely to result in different types of conflict in a business relationship/network context. In the case of cartels, this opportunistic behaviour influences cartel participants, customers, suppliers (not privy to the cartel agreement) and the wider public. Theoretical and practical implications are provided.